Indian flour millers seek 30% wheat import duty cut to stabilize prices

INDIA – The Roller Flour Millers’ Federation of India (RFMFI) has called on the Indian government to reduce the import duty on wheat from 40% to 5-10%, citing the need to stabilize wheat prices and improve availability, particularly in South India.

The demand for duty reduction comes amid rising concerns over food inflation and the economic impact of high wheat prices on consumers and small businesses, raised during the federation’s recent event, ‘The Future of Milling: Vision 2030 & Beyond,’ held in Panaji, Goa.

Navneet Chitlangia, President of RFMFI, emphasized that reducing import duty would help address the challenges faced by flour millers and curb market volatility.

“After the government completes its wheat procurement, it should reassess the crop size, procurement levels, and market availability. Based on this, the 40% duty should be recalibrated to allow for imports of 2-3 million tonnes of wheat. This would dispel the narrative of a low crop size and ease the pressure on the industry,” Chitlangia stated.

India’s wheat import duty was increased from 30% to 40% in April 2019 and has remained unchanged since. However, rising wheat prices and inflationary pressures have prompted calls for a review.

According to recent data, the Consumer Price Index (CPI)-based retail inflation for wheat surged to 8.8% in January 2024, reflecting the strain on both consumers and industries reliant on wheat.

Chitlangia shared that the federation estimates wheat production for the ongoing rabi season (2024-25) to reach 110 million tonnes, slightly lower than the government’s projection of 113 million tonnes.

Last year, the government procured 26 million tonnes of wheat for the central pool, with a target of 31 million tonnes for the upcoming rabi marketing season. As of March 2024, wheat stocks in the central pool stood at 14.41 million tonnes, well above the buffer norm of 7.46 million tonnes.

Despite sufficient stocks, the federation argues that imports are necessary to bridge regional disparities in wheat availability and stabilize prices.

“Even a small quantity of imports can help stabilize the market and ensure that flour millers, especially in South India, have adequate supply,” Chitlangia added.

Calls for a wheat board, market interventions

Meanwhile, the RFMFI has proposed the establishment of a Wheat Board, similar to the Makhana Board announced in the Union Budget 2025-26.

The proposed board would focus on promoting research, supporting farmers, and fostering the growth of processing industries.

In a message read at the event, Sanjeev Chopra, Food Secretary, assured that the government has sufficient wheat stocks to meet its requirements and conduct necessary market interventions.

He highlighted that this year, 30 lakh (3 million) metric tonnes of wheat have been offloaded to processors and millers through the Open Market Sale Scheme-Domestic (OMSS). Chopra urged the federation to ensure that the benefits of these interventions reach consumers and help curb inflationary tendencies.

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